Italy is a highly developed country where a new post-industrial type of economy is widely represented.
After the Second World War, the country’s economy developed at a faster pace than in other developed countries. This was due to the influx of capital from the United States, the availability of cheap labor, the development of tourism and the growth of incomes of this industry. All this allowed Italy to get closer to competing countries.
The industrialization of the country was completed in the 1960s, during the so-called “miracle economy”. The scarcity of natural resources was a decisive factor in the choice of the principle of economic transformation: to export in order to survive.
All post-war crises did not bypass Italy. In the mid-70s. in Italy there was a serious economic downturn caused by the energy crisis.
In the 80s, the Italian economy overcame a new economic crisis, curbed inflation and began industrial reconstruction. The consequence of this was the rapid development of the electronic and chemical industries.
The nineties were not without upheavals. Unemployment has reached alarming proportions, with 230,000 jobs lost in 1993 alone. Unemployment and the destabilizing effects of workers’ unrest became one of the main problems of the Italian government.
The structure of the economy is dominated by the service sector – 68.2% of GDP; the share of industry – 28% of GDP; agriculture – 3.3% of GDP.
Industry. The structure of Italian industry is characterized by:
1) greater importance in the economy of light industry sectors while maintaining certain positions of heavy industry;
2) the leading role of mechanical engineering;
3) a higher role of the chemical industry than in other EU countries;
4) the mining industry is poorly developed;
5) the importance of small and medium-sized enterprises.
Of all the developed countries, Italy has the sharpest territorial contrasts in the level of industrialization. In Southern Italy, industry employs less than 15% of the economically active population, and in the North-West it employs about 40%. The vast majority of the most advanced science-intensive industries are also concentrated here.
The regional policy pursued by the Italian government and the EU is aimed at eliminating the economic backwardness of a number of Central and Southern regions of the country. The industrialization carried out in these areas involves the construction of small light and food industry enterprises in small and medium-sized towns of Central and Southern Italy. There is an accelerated development of coastal industrial centers (Ravenna, Taranto, Cagliari in Sardinia, etc.) on the basis of the use of imported raw materials, in particular, oil.
In the structure of Italian industry, there is a constant increase in the share of the manufacturing industry – the basis of Italian industry. The leading place in the manufacturing industry is occupied by the machine-building complex, the share of which exceeds 35%. These include: general engineering; production of vehicles; production of electrical and electronic equipment; metalworking and production of metal products.
There is a slight lag in Italy from other industrialized countries in terms of scientific potential, so the country in MRI specializes in the production of machines and equipment of medium and low science intensity, supplying the world market with a fairly wide range of engineering products. In particular, it is one of the largest manufacturers of agricultural machinery, electrical household, packaging and food equipment, machine tools, textile equipment, rolling stock and other vehicles.
Italy is one of the world’s largest manufacturers and exporters of consumer goods, characterized by high quality and exquisite design.
Fuel and energy complex. Italy is extremely poor in energy sources, has an unfavorable energy balance.
On average, only 17 per cent of needs are covered by own resources. Almost 70% of the energy balance is accounted for by oil. According to this indicator, Italy is comparable among post-industrial countries only with Japan: about 15% – for natural gas, 7-8% – for coal, hydro – and geothermal energy.
Own oil production is small – 1.5 million tons per year. Abroad, Italy buys 98% of all oil consumed (over 75 million tons). Oil comes from Saudi Arabia, Libya, Russia. Italy has the largest oil refining industry in Western Europe in terms of installed capacity (200 million tons), but the degree of its use is very low.
Natural gas production (20 billion cubic meters in 1999) provides about 46% of its needs. gas is imported from Russia, Algeria, and the Netherlands. Italy buys about 80% of solid fuel. Coal is imported from the United States and South Africa.
More than 3/4 of electricity is generated at thermal power plants, which use mainly fuel oil. Therefore, electricity is expensive, there are large imports of electricity from France. After the chernobyl accident, it was decided to stop the work of existing nuclear power plants and not to build new ones. The main goals of the state energy program are to save energy consumption and reduce oil imports.
The ferrous metallurgy of Italy works on imported raw materials. Own production is insignificant – 185 thousand tons per year. Coking coal is entirely imported from abroad, mainly from the United States. Italy is a major exporter of scrap metal as well as alloying metal ores.
The import of raw materials for the industry predetermined the location of the largest metallurgical plants on the sea coast in Genoa, Naples, Piombino, Taranto (the latter, the largest in the EU, with a capacity of 10 million tons of steel per year).
In 2000, steel production amounted to 25.6 million tons (seventh place in the world). Numerous processing and rolling plants gravitate to large centers of mechanical engineering and to sources of raw materials (scrap). Enterprises of redistribution metallurgy were built in Milan and Turin.
The largest steel producers in the country are TNK Riva and Finsider.
In the world market, Italy specializes in the production of thin, cold-rolled steel and steel pipes. The main products of non-ferrous metallurgy: aluminum, zinc, lead and mercury.
The country ranks second in the EU and sixth in the world in rolled metals, accounting for 40% of ferrous metal production in the EU.
The chemical industry of Italy specializes in the production of petrochemical products, polymers (especially polyethylene, polypropylene) and synthetic fibers.
The industry is highly monopolized, dominated by large firms. The company “ENI” ranks first in Europe in the production of acrylic fibers, the second – in the production of plastics, the third – in the production of fertilizers. “Montedison” provides 1/4 of the production of chemical fertilizers in the country. “SNIA” specializes in the production of chemical fibers, plastics, dyes, plant protection products, medicines.
Italy ranks fifth in the world in the production of medicines.
The oldest and most important area of the chemical industry is the North-West. Due to the aggravation of the environmental situation, the lack of free space, difficulties with electricity supply, this region specializes in the production of fine chemical products. Major centers are: Milan, Turin, Mantua, Savona, Novara, Genoa.
Northeastern Italy specializes in the production of mass petrochemical products, fertilizers, synthetic rubber (Venice, Porto Marghera, Ravenna).
The profile of Central Italy is inorganic chemistry (Rosignano, Follonica, Piombino, Terni and others).
Southern Italy specializes in the production of organic synthesis products, mineral fertilizers (Brenzi, Augusta, Gele, Torto Torres and others).
Mechanical engineering is a leading branch of Italian industry. It employs 2/5 of all industrial workers, creates 1/3 of the total value of industrial products and 1/3 of the country’s exports.
The industry is characterized by a high share of transport engineering in production and exports. By automobile production (1.7 million in 1999) Italy ranked ninth in the world. The largest automobile company is fiat (Italian car factory in Turin). It is diversified and produces locomotives and wagons, tractors, marine and aircraft engines, road transport machines, machine tools, robots. In 1986, Fiat acquired a controlling stake in its competitor, Alfa Romeo.
The capital of Fiat is Turin, where the headquarters and the largest plant of Mirafiori are located; automobile factories were also built in Milan, Naples, Bolzano, Modena. The company has its branches in many countries of the world. In the 1960s, she participated in the construction of the giant VAZ plant in Togliatti.
Fiat is among the top ten largest car manufacturers, which accounts for 5.3% of world production.
The company “Ferrari” is known for the production of racing cars.
The international specialization of Italy is not only the production of cars, but also motorcycles, scooters, mopeds and bicycles.
Shipbuilding – crisis branch of transport engineering; the tonnage of vessels launched annually does not exceed 250–350 thousand rubles. Shipbuilding centers: Monofalcone, Genoa, Trieste, Taranto.
Various products manufactured by the electrical industry – refrigerators, washing machines, TVs. The industry is characterized by a high territorial concentration in Milan, its suburbs and in the neighboring cities – Varese, Como and Bergamo.
The production of products in electronics is growing. Italy produces personal computers, electronic components. The industry is led by Olivetti, one of Europe’s largest manufacturers of typewriters. The main factory of this company is located in Ivrea, north of Turin. Electronic components are produced by the Italian-French company STS-Thomson.
Light industry was developed in Italy. The country is one of the world’s largest producers and exporters of cotton and woolen fabrics, clothing and footwear, furniture, jewelry and earthenware, etc. In terms of shoe production, Italy ranks third in the world after China and the United States. The Italian company “Benetton”, specializing in the production of ready-made clothes and knitwear, is one of the largest in Europe, has its branches in 110 countries around the world. The company’s headquarters are located in Treviso.
Services. Tourism and banking play a leading role in the industry. The most important source of income is tourism. Italy is visited annually by over 50 million tourists. More than 3/4 of the total turnover of the Italian tourist business falls on three cities: Rome, Venice and Florence. Almost all tourists arriving in Rome visit the unique Vatican City State. The so-called “shopping tourism” is also developing, attracting wholesalers of products of Italian small and medium-sized enterprises, as well as individual consumers of Italian clothing and footwear.
Italy is the birthplace of banks, 67% of its settlements have banking institutions.
In Italy, all modes of transport are well developed. The country has a developed network of railways (9944 miles long) and highways. More than 90% of passengers and 80% of cargo are transported by cars. The main transport artery of the country is the “freeway of the sun”, connecting Turin and Milan through Bologna and Florence with Rome, Naples and Rogio di Calabria. The Italian fleet of cars has about 32 million. 80-90% of imported goods are delivered by sea. The largest ports are Genoa (cargo turnover of 50 million tons per year) and Trieste (35 million tons per year). The main coastal port of the country is Naples.
There are 34 airports in Italy, among them the main ones: Rome, Genoa, Venice, Trieste, Palermo, Naples, La Spezia.
Agriculture plays a much more important role in the Italian economy than, for example, in the UK and Germany. At the same time , the industry provides only 75-80% of the population with food, despite favorable natural conditions. This is due to the preservation of archaic agrarian relations in the South and the fragmentation of farms. About 3/4 of them have an area of less than 5 hectares.
Although thanks to the state agrarian policy and European integration, agriculture has changed a lot. The concentration of production in the hands of large owners has increased due to the ruin of small owners; lease and cooperation relations have expanded; irrigation; crop yields and livestock productivity have increased.
The north, including the Padan Plain, has more favorable conditions for the development of agriculture. 2/3 of the irrigated areas are concentrated here; 3 times more mineral fertilizers per 1 hectare of cultivated land are applied than in the south.
The main branch of agriculture in Italy is crop production. The leading branch of crop production is vegetable growing. Annually in Italy, 14 million tons of vegetables are harvested, of which 5 million tomatoes (the leading areas are Emilia-Romagna, Campania, Puglia).
Grain farming, the second most important branch of crop production, is experiencing a crisis. In terms of grain harvests (18-20 million tons), Italy is 2.5 times inferior to France. Wheat, corn, rice are grown.
The most important technical crop is sugar beet. In terms of fruit and vegetable harvests, Italy is in first place in Europe. Italy shares with France the first place in the world in grape harvests (10 million tons) and the production of grape wines.
The development of animal husbandry is constrained by the lack of fodder and the sharp competition of cheaper products of France, the Netherlands and other EU countries.